Allowing wholesalers to charge different prices to both off and on premise licensees will allow on premise licensees to take advantage of programs currently not tailored to them. Since both on and off licensees have different routes to market, channel pricing allows the licensees, in both channels to remain competitive in their environments.

 I support the proposed change to allow for separation of On Premise and Off premise pricing. There are significant support dollars that suppliers can infuse into the Virginia market if  On Premise specific programming would be allowed. Suppliers target higher end brands that are profitable for the restaurateur and assign budgets specifically targeted toward driving education and trial within the On Premise segment. Education and trial on these wines drive price trade up at the restaurant level but also have a residual effect at retail when those consumers feel more comfortable and understand higher end wines that they were able to experience through these feature programs. The reason suppliers do not offer more of these promotional dollars are that if these prices were offered today in the VA market and a large Off premise retailer were to buy large quantities, the wine supplier program budget would be obliterated and the product would not achieve the desired affect in the marketplace.